This chapter examines the similarities and differences between physical, psychological and virtual realities, and challenges some conventional, implicitly dualist assumptions about how these relate to each other. Virtual realities are not easily understood in either dualist or materialist reductive terms, as they exemplify the reflexive nature of perception. The chapter summarises some of the evidence for this “reflexive model”—and examines some of its consequences for the “hard” problem of consciousness. The chapter then goes on to consider how these realities might relate to some grounding reality or thing-itself, and considers some of the personal and social consequences of becoming increasingly immersed in virtual realities. Although this chapter was published in 1998 and develops work published in 1990, it presents a form of “radical externalism” that anticipates many themes in current (2006) internalism versus externalism debates about the nature of mind. It is also relevant to an understanding of virtual reality “presence.”